the same feeling in italy.a significa nt difference between for example, migration, there's a significant difference between italy and uk. the uk... people are very mixed with each other and there's no comparison with the delete. one must question, a lot of people of race. why is populism seen as a negative? do you see it as a criticism that somebody is populist?” do you see it as a criticism that somebody is populist? i think the term started in a negative connotation but a lot of populist would actually be very proud of it. i think salvini himself... he likes it. he likes being called a populist because their message is we are the people as opposed to the elites... yes, i think it is a classic example in which our terms shift as com pletely in which our terms shift as completely meaning depending on who's using it. i am afraid we have to do it off the television because time is up. thank you very much for joining me. tomorrow morning, we are getting up early, heading to verona, jumping ona getting up early, h

is flexing its new muscle by shooting down italy's controversial budget draft but does italy care and will the markets have a say over the country's growing deficits. and could tonight be your lucky night most likely not when someone has to take home the biggest u.s. lottery jackpot ever we'll tell you how much. i'm stephen beers with your business report the u.s. is facing pressure over its arms deals with saudi arabia following the killing of dissident journalist the us president donald trump says the stakes are too high to cancel the agreements but the actual figures that is the amount of money and the american jobs they create are hard to pin down. intent on protecting arms deals and economic ties with saudi arabia president donald trump has so far rejected sanctions which is normally only too happy to impose. but i would prefer that we don't use as retribution cancelling one hundred ten billion dollars worth of work which means six hundred thousand jobs but as the global outrage at the kitchen keep killing mounts so to trump's numbers. i don't want to lose a million jobs i don't

chzech republic and italy was double or triple a and italy is triple b and itathe basic make o economiconger than anyone else it's a game in itself. >> we have to bring in the latest on brexit we'll come back to your conversation in a minute theresa may is going to tell parliament that 95% of the brexit deal has been agreed. addressing mp may will attempt to demonstrate that the government has made progress on brexit talks despite recent setbacks they will confirm that the u.k. has settled many issues including security and the future of gibraltar adding, quote, the vast majority of the agreement is now clear speaking to cnbc they explain the agreement between brittain and the eu over the status of the u.k. territory post brexit. >> the protocol will be between the united kingdom and the european union, not between the united kingdom and spain it's an annex to the withdrawal agreement. it will set out how gibraltar will form that as you know, gi brbraltar has h different status, a differentiated membership which called for a differentiated process of withdrawal and that's what's now as

moscovici has an eye on markets outside of italy. commentsrence -- the of not seeing contagion risk, i think he is saying that was fingers crossed behind his back. there has been a lightning in spreads -- widening in spreads over the last week. there are spanish factors at play. it looks like spillover from the italian markets. was this only an italian concern? keep the wants to focus on italy but it is broader than that. vonnie: i want to broaden things out a little bit. we don't want to downplay the move in italian market, up .5% now. tell us about things you like at the moment. what markets are you nibbling at? we have a preference for european equities from a regional perspective. that has been a possession that has not enjoyed the strongest of tailwinds. but on a valuation basis, we think they are likely to perform over the medium-term. moving away from the equity space, we have been looking at the discount building emerging market fx and sovereign debt. it looks interesting to start nibbling at. the broader picture would be we

in finding a path of the budget which is sustainable that in italy is high. >> do you think italy is taking the scandal with european officials because italy is not first one to break budget rules? they're not the first one to go down this path of ignoring the budget discipline. do you think they're saying others have not been punished, that perhaps the eu is bluffing and they simply won't be able to punish us because we're too bill to fail? >> that's -- hopefully not there is a limit to -- and it's a risky gamble on top of that, italy has a high debt so i think it will not be good for the markets, for the credibility. there is a tension between the commission, european union and italy. what happened in the past has been excessive and created moral hazard hopefully, you know, we see this with brexit also there is a tendency for the rest of the union when you have somebody that tries to depart so strongly or to confront too strongly europe as a whole, then the other countries unite. >> right >> so there is a risk of italy getting into a corner. so i think the dialogue is the only way

italy and spain often are compared. let's take a look at what is happening in terms of the individual stocks and names that we are watching. wirecard under significant pressure. this is the tech company that took over in the dax from comments bank. obviously a significant step in the landscape. this is a stock increasingly being shorted. it is trading down 11% today. we were talking about the aluminum market. hydro up higher by 3.9%. to want to bring you some of the italian banks. bpm trading down today by 5.8%. let's find out what is happening with the u.s. markets. the bond market is closed, but there is still market action we need to pay attention to. >> we do have the equity markets open in the u.s. unlike europe, we have to clients for the major averages. you can see the tech heavy nasdaq is underperforming, down about .4%. its worst three days since july. you were mentioning the fact that the bond markets were closing. rising yields really pressuring equity investors to wonder what the price of risk will be. bonds

is unhappy with italy over its big spending plans brussels says it is being blackmailed. that story and all of your business headlines with them for the one coming right after. the. time for an upgrade. our furniture there grows old by. a house with no. poor design highlights you can make yourself. trends tips and tricks that will turn your home to something special. upgrades yourself with d. w.'s interior design channel on you tube. is known as. you know the banks. and so was the language of the bank. speaking the truth global news that matters g.w. made for mines. saudi sordid investments sophia rain is economic reputation is under question following the disappearance of a prominent journalist. and brussels braces for a contentious trask's budget from rome it promises to new heights on the debt front the european commission doesn't like it what about the monkey. i've been physical and let's do business in use just in u.s. president donald trump says he's sending secretary of state might on peo to saudi arabia immediately he's making selman of a missing dissident journal

daniel: i do not think it is contagion just from italy.ries have all but abandoned reform in the last three years. the new governments are trying to push a very aggressive agenda of increasing expenditure while a moresame time, having than optimistic assumption of revenues. isks when the ecb support starting to fade and at the same time, your imbalances are rising , obviously come in the shape of bond markets and spreads widening. support,hat the ecb the spreads are extremely low. it is very unlikely investors will buy bonds at these yields when the ecb stops buying them. guy: where does that leave the ecb? does the ecb stop buying them? daniel: i think it has to because the ecb finds itself between a rock and a hard place. if it does not do what it has said it will do, the signal it will send to markets is things are a lot worse than they have seen because of things do not start normalizing the policy, they will run out of tools when the cycle changes. additionally on the other side, if they continue to buy, what happens is these countrie

commission rejects italy's budget due to the country's rising debts we'll have a look at what happens next between brussels and rome coming up in business with ben fizzling and also you're going to the top of the hour. time for an upgrade. our furniture that grows all by. house with no roof. or design highlights you can make yourself. against tips and tricks that will turn your home to a special. upgrade yourself with d w's interior design channel on you tube. every journey begins with the first step and every language with the first word published in the cook. recoat is in germany to learn german why not learn with him it's a simple online on your mobile and free shop d w z e learning course nico speak german made easy. after. a showdown between brussels and rome italian populist say they're not backing down on plans to triple spending e.u. projects its budget plan in a euro zone first. and us judge upholds a verdict finding by as one sound so liable for failing to warn its weight killer can cause cancer. and more foreign investors flee pulling out of a key investment summit in saudi

a huge drama happened yesterday in italy.ake a look at the markets and see how they are bouncing back. we have gains on the major equity indexes. france is up and england is up. but spain is down and germany will change. this is bloomberg. ♪ ♪ matt: let's get your top headlines. chinese markets rally in late trading as the country's top regulators promised to control risk in financial markets. coal markets in europe are up. hity-germany bond spreads the whitest in more than five --rs after italy the sizes criticizes the budget. and president trump says missing journalist jamal khashoggi is likely dead and warns of reprisals after steve mnuchin withdrew from a conference in riyadh. good morning. this is the european open. i am matt miller in london. presentation to investors in oslo. this stock up. this software stock up. let's look at the downside. thee are the losers on stoxx 600. this french computer stock down. and this stock down after warning on margins in their construction business. 6.8%.y michelin,s o out of guilding

i don't think that they will junk italy.mething which investors will be watching pretty closely. atimately, it will be measured response. manus: does our risk increase with the taper from the ecb? it has been the backstop in for those peripheral nations. is that the risk we are under assuming as we travel through taper? good point.ly we're in a shift right now whereby the ecb clearly is winding down its net bond purchases. 2015, the ecb has been buying more than the italian government has been issuing on a net basis. that's a pretty powerful backstop. premiersome risk increase, some spread widening across other assets within the euro area, it is warranted as part of preparing for the ecb winding down its qe program. in your conversation with clients and investors, what are they most worried about now with italy? >> there are some concerns about contagion, not only to other broadlys but also speaking italian assets. worried about what this means, does this mean the risk of default has gone up for italy? does the risk of italy

has a lot on its plate i ask craig elam senior market analyst at wanda in london whether italy is too big to fail well i think they would certainly have to. support the economy because the alternative is that italy with actively have to tumble out of the euro out of the you and i think that be far more catastrophic and even more dangerous than the u.k. voting to leave so i think the alternative would be that they have to throw in their support the question is how they do so this is effectively what the program from the e.c.b. was created for. all markets in struggling economies but that would mean a bailout program it would mean more imposition from brussels not less on the question again is would the italian electorate vote for. there's also no solution in sight for an orderly breakfast if you're already said that italy dropping out of the euro would be worse than break state but after sunday's talks failed the e.u. now seems to prepare for a no deal breaks it and we've seen that the pound is or and ready under pressure how is the u.k. financial world preparing for such as an aria. w

you have been doing a lot of work on italy. let's talk about italy. it does seem to be moving the market. call me nerves in the markets. you think that is the right move? >> i think it is the right move by the reaction has been excessive. i'm not sure we will sustain a long-term reaction. it is positive the italian government has reacted to market threats. uptick for euro made sense. they are showing a lack of understanding of the gravity of the situation. adjusting the target, it is too late. a worrying stage for yields, they start triggering a kind of negative spiral and become self-fulfilling. i am not convinced this will be sufficient to put the italian debt to bed. ec -- is thethe largest risk to markets. does that sound the markets they could step away from? makes it very difficult. october was the month they were scheduled to cut their purchases. worrying.htly not guaranteed to head scenario.oom if officials do not understand the gravity, this could get out of hand. ying is particularly worri is the fact that many of the way measures are about

coming up, italy rattles european markets.ed about a proposal to increase budget deficits. we will take a look at the impact on italian assets and the euro next. this is bloomberg. ♪ shery: this is "daybreak: asia." i'm shery ahn in new york. haidi: we're told italian assets are under pressure amid concerns of the populist government. the dollar pushed hires while emerging markets slid. we looking at italy as becoming something of a proxy threat, particularly for emerging markets this point? >> italy's main problem for emerging markets is its impact on the europe. it is emerging-market currencies versus the dollar tend to follow the direction the euro moves in versus the dollar. italy has hurt the euro, pushing it down to this mid-115 type of level. that has moved the dollar stronger versus emerging-market currencies. if italy has an issue and this italian war on the eu continues, and it suppresses the euro-dollar further, it will put upward pressure on the dollar versus other emerging-market currencies, including asian curren

it doesn't mean italy is going to drop out.u cover investment grade, but are there better opportunities in investment grade or high-yield? the sub investment grade space, particularly loans. you have a floating rate asset class. much in thehad as u.s. market. in the area to look at. investors are looking at at the moment. juliette: you are talking about brexit. don't forget the irish in terms of the hard brexit. sticking point at the moment in terms of the brexit negotiations. what happens to that border. they want it to be as open as can be. opportunitieshe for the u k to stay may be bit closer to the eu. these are interesting negotiations. nejra: we are seeing lots of headlines coming through. netflix, just one example. something like five deals pulled in the last few weeks. u.s. a more opportune market at the moment when it comes to credit? >> you have had volatility in the market. even if you look at u.s. issuance, it has called down -- calmed down. is an interesting one. they had results and they were better than expected.

also coming up tonight italy's debt spending has to stop the european commission today rejected italy's budget for twenty nineteen sending a signal that e.u. countries must keep their spending in check and scientists here in europe say they've detected plastic particles in human stool samples proof that plastic waste has now reached the top of the food chain. it's good to have you with us the worst cover up ever those are the words of u.s. president donald trump describing what he says was a bad plan by this all these to kill critical journalist jim all. his comments followed a speech by turkey's president read. the one today saying that his country's investigators have determined that she's brutal killing was meticulously planned with all wise on saudi arabia and any involvement that its leaders may have had in the killing crown prince mohamed bin solvent resurface today in public for a key business meeting. satisfied was the word crown prince mohammed bin solomon used to describe how he felt at the high profile future investment initiative conference in riyadh. despite the prince's sm

italy is in the e.u. to stay that's the message of prime minister josep a contact who says his country won't leave the european union but that it will stick to its deficit hike that's despite criticism from brussels conti argues the economy needs a lift of the blocks biggest member state germany has warned rome to be careful with debt and moody's has recently cut italy's credit rating. italy's prime minister has defended the deficit busting budget insisting his country needs a new approach to stimulating the economy because previous efforts have failed in the second quarter growth slowed to its weakest pace in nearly two years in. the middle of a big market draft as well constructed and well formed the provisions for growth are very good in respect to what we are doing at the moment. he has pledged that next year's deficit won't exceed two point four percent of g.d.p. but that's triple the previous government's forecast the italian leader said it would fall below two percent by two thousand and twenty one

now to italy. the mayor of a small town in the south of the country, a man who became a symbol for welcoming migrants to italy has been placed under house arrest for allegedly aiding illegal immigration. our rome correspondent covering the story for a spirit she joins us from rome. give us the details on this things --it >> everyone across italy's is asking how is it possible that the mayor of -- come of this tiny town, domenico lugano could be accused of crimes. after a lengthy investigation by the police, they have accused him of aiding and of aiding illegal immigration, promoting marriages, and misusing public funds for the allocation of garbage contracts in this town. he has been a hero for many people, not only in italy, but around the world. he was named by fortune magazine as one of its top leaders in one of -- just a couple of years back. he has rebuilt what was essentially a ghost town, one of these towns where many people emigrated abroad and had a dying population. migrants whowith reene

italy is tested. italian debt could be seen as too risky. ♪ manus: welcome to "bloomberg daybreak: europe." cash bond traders are back at their desk. this is how the bond market looks. 250e waiting for over billion dollars worth of supply. worste looking one of the routes in the bond market since 1976. the merrill lynch index. this is ramping and boring throughout the bond market -- rampant throughout the bond market. will the u.s. go for a currency manipulator on china? you see the strongest running streak since july. anna: good morning. they have just had their lunch break over in the shanghai markets. a little stronger after the lunch break. what a change from yesterday, where we saw a lot of selling by foreign investors in particular. lot k to focus here on -- of focus here on the offshore yuan. we understand treasury secretary mnuchin is under a body of pressure.- lot of 3.5% was breached by the italian 10 year yesterday. that as it to watch opens up today. we will hear from the finance minister

debt spending hasta stop the european commission today rejected italy's twenty nine thousand budget sinning a clear signal that each country's must keep their spending in check and campaigning with donald trump at her. you follows the republican senate candidate in the state of arizona a race that republicans need to win to keep their own razor thin majority in washington. it's good to have you with us tonight we begin in turkey reports say that investigators are checking whether items found during a search of these salty consulate vehicle belong to journalists. now can show he was killed two weeks ago inside the stamboul compound turkey's president. today shared some of his country's findings in the. investigation saying because shelby's brutal killing was meticulously planned with all eyes on saudi arabia and any involvement its leaders may have had in the murder crown prince mohamed bin solomon resurfaced in public today for a key business meeting take a look. satisfied was the word crown prince mohammed bin solomon used to describe his mood at the high profile future investment

you're watching news still the comp italy's banks are in trouble again while growing the e.u. are at loggerheads over government spending now moving since downgraded the country's credit rating to one notch above junk status. gardell first has that story and also in business headlines coming up in one minute. i'm not laughing at the gym i just sometimes i am but most of the things which are the result of mistakes deep into the german culture of looking at the stereotype the question but if you think you see from countries that i now know. you know you did see me take from his grandmother. you know it's all about a new i'm rachel join me for me the gem from d.w. . post how about taking a few risks you could even take a chance on work. don't expect happy endings. as roman brussels are at loggerheads over the debt movie no sound it leaves government debt to just about junk status but markets trot off the downgrade as long as it doesn't get any worse. dryness as some of the profits were down as a result of expensive fuel and crew strikes and it faces criticism of its handling of a

one factor is what is going on with italy right now. italy, there's no plan b.b il -- how destabilizing can this be? unprecedented compared to the previous [indiscernible] we are talking about .6% deviation. guy: their point will be that very few countries in the past -- have done it with the debt burden that italy has. not at risk of having an unstable bond market -- bund market. --eisa ali is vulnerable italy is vulnerable to what the government is doing. being announced would amount to 5% to 6% gdp fiscal expansion. if investors are looking for an opportunity to sell, this is a minister that could trigger it. : if the european union union allows us to go ahead, other countries would be demanding as well, especially er countries. the french have already said they will do the same. we are wondering how much solidarity there will be between 10 she's in the end. it is not the year -- how much solidarity there will be in the between countries. it is surprising to see such a big market reaction to these stories. we have a populist government in place that needs to

turkey has questioned the saudi royal family's connection to the istanbul killing also coming up tells italy to get in line and the european commission has rejected at least twenty nine thousand budget brussels is sending a clear signal to the e.u. won't accept a drastic rise in debts for its member countries. it's great to have you along i'm leyla iraq the saudi royal family has been improper embroiled in controversy since journalist from official she was killed earlier this month in the saudi consulate in istanbul as the high profile future investment initiative kicked off in riyadh crown prince mohammed bin some on has made a public appearance he told reporters that he was satisfied with what he saw despite that several international companies have stayed away in protest the saudi government has admitted it is facing a quote crisis because of the controversy earlier king solomon and prince muhammad received kushal she son and brother in riyadh were there too or else express. their condolences radio reports infrastructure use son has been banned from leaving saudi arabia. and earlier turke

than hosting an event like this so these maserati cars brought in in special cargo jumbo jets from italy are proving very controversial people are saying it's a luxury that papua new guinea. but critics say the money should have been spent on aiding polio efforts and earthquake victims and not fancy cars and a thomas has more from sydney and neighboring astray. that conference which will be held in port moresby next month when we easily the biggest international event that happened you guinea has ever hosted and it was already controversial given that happen you can it is a relatively poor country many have been saying that happen you get these governments should be spending money in places other than hosting an event like this so these mass arrests cause brought in in special cargo jumbo jets from italy are proving very controversial people are saying it's a luxury that papua new guinea. but critics say the money should have been spent on aiding polio efforts and earthquake victims and not fancy cars andrew thomas has more from sydney and neighboring astray. late that conference which w

now moving on to italy. italy is in the eu to stay.hat is the message from prime minister giuseppe conte day who says his country will not leave the bloc. he argues the economy needs a lift. germany has warned rome to be careful with debt, and italy's credit rating has been cut. reporter: italy's prime minister has insisted his country needs a new approach to stimulating the economy because previous efforts have failed. in the second quarter, growth slowed to itsts weakest pace in nearly two years. >> this budget draft i is well coconstructedd and formed.d. the e provisions for growth are very good in respect to what we're doing at the moment. reporter: he has pledged that next year's deficit will not exceed 2.4% of gdp. but that is triple the previous government's forecast. the italian leader said it would fall below 2% by 2021 and guarantee the national debt to gdp ratio would decline. he also dismissed any suggestion that italy would leave the eu or the eurozone. >> for italy, there is no chance, no way, to get italexit. there is no

just one notch above junk status a credit ratings downgrade for italy of one of the markets wide and one of australia's last piano makers adds a full two walk to his latest creation but will the instrument keep an age old craft alive. i've been physical and let's do business just about everyone's bailing out now the saudis a struggling to get their international summit up and running. siemens chief executive joe kayser is the latest to pull out of the future investment initiative following the killing of journalists. the german engineering giant is one of the last companies to decide against sending its top executives to the posts in the days that many companies including j.p. morgan and ford had canceled as well as u.s. treasury secretary stephen moved. to give a response to this story from pocas blitz a financial corresponded frank but how. is this going to have knock on effects i mean we're talking about just one called friends but is this going to have no one affects on the economy as a whole for saudi arabia. a lot of people are not going to want to hear this but it's probably g

italy has a lot of debt but they owe it to italian banks. but italy is a much larger economy.ly leaving the eurozone or hinting at leaving the eurozone is a much bigger event it's not something that the eurozone would be able to sustain. so, you know, even a hint of italy saying we've had it with the rules coming out of brussels, we don't like being told what to do, that's a larger situation. it's not necessarily a financial contagion because it's much more contained, the banks are better capitalized, but it's something to keep a close eye on it's one of those things that unwinds over a much longer period of time than necessarily what we typically are looking at things that happen over quarters this is something that happens over-years it's the tip of the iceberg, if anything upsets the apple cart in the eurozone and make that experiment not go well, it could be italy not being impressed >> i could not upset your apple cart i tried to throw you under the bus with the italy thing, couldn't do it art hogan, thank you very much. >>> a big upgrade to tell you about that follows yo

onto italy.en a soweto appeared this is the head of the lower houses budget committee. he added the populace government has no plans -- joining us now is the deputy director from brussels. thank you for joining us. anxious markets so about? >> i think they probably are. tore has been a agreed number that will be consistent with the fiscal policy. anything from this is reason to worry about. the numbers are small. they are not insignificant. they could really cause a problem, because the problem is that the deficit. it is the debt. have you bring the debt in a position that will help italy recover? this is the issue here. any deviations on economic terms can be quite detrimental for italy. beyond the economics, i think the importance here is the symbolism. how does a country like italy go against the commission? we are in for possibly a fight between them and the question is how it's going to end. francine: when i spoke to the , he may, is about the euro and he said it is unfair because italy -- f

it's not really understates the problem i think if italy if there was an italy crisis it would make greece look like it's a policy i think mr young because rhetoric solely understates the contagion that could result as a result of italy's debt trajectory getting out of control would it make sense to for it to lead to to leave the euro as some leading italian politicians have suggested. no not that would be a catastrophic scenario under any circumstances just think about the overall debt the stability of the banking system all of those states would have to be ready to nominate seats in lear it could take the entire european banking system down with it and i think this is where the european commission really needs to tread carefully when it comes to dealing with these politicians because for me i think i think that. walking into a trap laid by this new italian government so how to deal done with this new italian government. well i don't think what the italian government is asking for is actually unreasonable they're also going for a budget deficit of two point four percent of g.d.p. that's u

let's talk about italy first of all quite surprising to the not talking all that much about italy considering where mr draghi comes from. yes not just the fact that he's italian also a lot of questions in the question around from journalists about italy and that's of course because there was some expectation that mario draghi and the e.c.b. might in some ways show that they would you know are leaning towards helping italy in some way shape or form but none of none of the sort happened mario draghi said that he personally is confident that an agreement will be found because both sides were seeking a dialogue however this is mainly a fiscal issue and the e.c.b. doesn't deal in fiscal issues it deals in monetary policy and so at this point it's not going to get involved it will however continue to watch the situation continue to watch for possible spillovers should italian banks get into more trouble and should that be the case it may adjust its policy we'll be looking for december to see what's going on you know until now and following the financial crisis the e.c.b. has basically used up all t

with people saying that they're too flexible with italy but i think the e.u. as well as its leaks are going to be looking at how markets react and also a while they want the accounts to be balanced they also don't want to stoke too much of the a populous resentment not just here but in other countries as well i think a lot will depend on what happens in the next two weeks the economy minister is going to be selling his case to the e.u. and it's he's prime minister will be meeting the leaders of germany and france as well as leaders to put forward their case the rationale for this kind of budget the one thing i'd like to know the media's been talking a lot about italy's debt growing and that the fact that italy already has a mountain of debt is there a plan by the government or any willingness to actually reduce that day well if you look at the budget proposal that's been put forward their forecast believes that by putting in place these expansionary measures growth will rebound and therefore the debt will be reduced as well as the deficit will fall so that the

italy's real per capita g.d.p. is now lord and the euro while the euro zone experiment began in two thousand in one thousand nine hundred eight even greece has actually registered some growth but italy hasn't while this supposedly populous politician say that your hasn't delivered for italy don't they actually have a point that's why they won the last elections yes they have a point the people the general the people they feel to be who are concerning the chase power and but the problem is that in the last years we were affected by a huge world economic financial crisis and we had also to to put that in that would compare isn't we the european crisis that we had after two thousand and five when the european constitution was rejected then we had the huge prizes india little zone no we don't really we do not really have a lot of resources. to deliver to deliver to the defense was to do to the to the military is as we may say and maybe often later this month the european commission may take an unprecedented decision of

i will start with italy. big news overnight and conflict" who is in charge of the house of parliament. he says i'm more convinced that italy with its own currency will be able to resolve its problems. but then he turned around and with our own francine lacqua said that there is no plan to leave the euro within this government. >> they need to support and they realize that. the idea of decoupling from the euro is too much instability. it is completely unpalatable. david: they took the budget with a 2.4% deficit up to the eu, and said, thank you very much. >> it is investors pricing and a lot of risk and italy. you have to have some really strong pushback which, maybe a few ticks below that. but there's not a lot the eu seems to be able to do to enforce. this is the environment we've been in for years now. i don't imagine italy will really change the game. >> how about the u.s.? it is over 3%. but it seems to be ignored. >> we see the u.s. with expansionary and budgetary policies. this is exactly what will be h

it's four months since italy's new government was sworn in.e coalition swept to power, saying they'd end poverty. they promised tax cuts, better pensions and new social welfare policies, all of which come at a cost. and now the d raft of which come at a cost. and now the draft of the budget to finance those pledges has put the country on a collision course with the eu. it says italy's proposed government spending is too high, and the country's public debt breaks eu rules. translation: country's public debt breaks eu rules. translationzlj country's public debt breaks eu rules. translation: i have three questions for the italian government, how will it pay for the new measures? who will meet the additional costs? and how will be debt be reduced? italy's plans would set the budget deficit and 2.4% of gdp to allow for greater spending. that's actually below the eu's deficit limit of 3% of gdp, but the country already has huge debt. it currently stands at 131% of gdp, second only to greece. and its memories of the greek crisis that hang over europe

italy escapes junk rating.t risings after moody's put the country in a stable territory. the international backlash grows against saudi arabia against the death of jamal khashoggi. ♪ francine: good morning. this is "bloomberg surveillance.

tells italy to get in line with european commission has rejected at least twenty nine thousand budget brussels is sending a clear signal that you won't accept a drastic rise in debt for goods member nations and can be a deal with the donald trump adverse side d.w. news follows the republican senate candidate in arizona a race the republicans need to win if they keep their own reserves thin majority. thanks so much for your company everyone crowns friends crown prince mohammed bin some on saudi arabia has appeared in public albeit briefly for the first time since the death of journalist to muscle shape saudi arabia has been embroiled in contra. she was killed earlier this month in the saudi consulate in istanbul and b.s. made a short appearance at a major investment conference where she has been boycotted by several international companies in protests at national she's deaf the saudi government has admitted it is facing a quote crazes over the controversy our earlier king some on and prince mohamed received the son and brother in riyadh where the tour els expressed their condolences me

jeje it's friend also had big hopes he's been in italy for eight years. during that time he hasn't gone home one. here. i'm neither happy nor unhappy about the working conditions. the problem is that it's tough on the back and it always aches if. but nobody wants to go back to india the money that they earn here is needed. but that is like with. this. town sure and it's not all doom and gloom. and in the beginning when i first arrived i lived near the beach in rebuttal. well . it was the first time i'd swum in the sea. it hit a nerve that the good news for. the indian community has grown over the years they have opened stores and restaurants and there to temples in the area. you know that there's not much contact with the italian community you. know. sometimes i think about the people who eat our vegetables i know that many of them are excellent to germany at the to restaurants that i often wonder if the people there think about are sometimes good about the conditions that we work. and so forth and. then meet the families for freedom mothers sisters and w

they went in hard with italy.id they wanted a budget deficit well above where the eu would want to allow. >> they are sticking to their original plan of having a deficit of 2.4% next year. they are saying their budget and economic plans are so good that tilray will grow so much in the economy will perform so well that the deficit by itself will decrease as a percentage of the italian economy in 2020 and 2021. ofy are making a promise now something that will happen a year and a half or two years from now. to me, this is mostly a signal they want to look at the financial markets, and this is not written in stone. i think you hit the nail on the head. when they talk about deficit promises two years out, there is only so much they can reassure. to the degree they want to play ball into the agree they are not being antagonistic with europe, is that something that will reassure investors that the government is not trying to start trouble? adriano: it seems to me that investors are clinging to what good news they can get

italy is a fiscal discussion. there was not much discussion about italy.sident was permission to quote what he says. he said we had to observe and apply fiscal rules, and we are also seeking a dialogue. is, canis what it answer other questions on other tracks. thank you. good afternoon, mr. president. still about italy, i would like to refer to your recent statements that the italian situation was not posing any risk of contagion. my question is if you have confirmed the statement or if it has changed? at that pointsaid in time there was no sign of contagion. let me also respond to the other part of the question asked before about the facts. what is the context? the context of our discussion today was the statement by the vice president of the commission who said he is seeking a dialogue. the second part of context is what is said in the previous press conference in the course of the imf meetings. -- take it for what it's worth, i'm confident an agreement will be found. facts. me come to the interest rates have come up. they are coming up. that means the l

on the one side, italy has sound economic fundamentals, but because of the dimension of its debt, italyable. but on the other side, europe as well, one third of the italian debt is held, so third of the italian debt is held, so that means around 4000 billion euros. an eventual run of the italian debt would imply large losses for investors abroad, not to say about the consequences for the euro. so i think there will be a negotiation around the timing, the design and implementation of the fiscal expansion. it's been really good to talk to you, thank you for speaking to us. the clock is now ticking, as sally said, for the third largest economy in europe, and they have until noon today to get that revised plan in. i wonder if the italian budget clock is on the wall next to the brexit clock on the walls of the european commission! let's take a look at some of the other stories making the news. investors around the world have pulled $650 million in funds from saudi arabia's equity market over the past week. that's according to the financial times. that trend may continue in the ongoing diplom

says italy's italy's plans break its rules and restore confidence in the euro zone . and next year's fiercely debated budget plans of the italian government also include what is called a so citizens wage it's a flagship policy of italian deputy prime minister luigi the meiers anti establishment five star movement which is governed italy with a right wing leader since june the basic income scheme has entered pulling the poorest italians out of poverty and bolster the economy those eligible will receive a payout of up to seven hundred eighty euros per month without conditions attached critics fear the ten billion euro initiative will destabilize the economy further because it is largely financed by debt. inside a job center in a poor naples neighborhood dozens of people are filling out the same form. a team of five employees helps them but they use paper clips and piles of folders more than computers. soon the job centers will be launching a new welfare policy but no one's explain the details to local officials. of the all see by three we've met two or three times and l

but italy is part of europe so it has to follow certain rules rules that have saved us up till now. i think we need to carry on like that they're right. it's clear that the government are going to take this situation forward we need to be sure we're strong enough to keep up this stance this is. required to have a budget approved is clearly quite tough but to be held to task over your choices when you are a member of a union of countries is understandable the simple principle. deputy prime minister mathias salvini doesn't think so during a visit to romania he said there's no going back on the budget ramping up the rhetoric he accused the e.u. of attacking not a government but an entire nation. for earlier we asked our correspondent in brussels max half ben what could happen next in helmand defiant does he think the italians might yet become. it's hard to predict with this government we've never had a populist government of this nature in a big country in the euro zone so predictions like i said are very hard and what's coming out of rome or in this case out of bucharest from the head

just one notice above junk status that's not a nice place to be a credit ratings downgrade for italy but why aren't the markets wired. a new study shows developing countries a woefully underinsured for natural disasters. and gibraltar's border with spain a walk in the park. for workers things could get tricky post breaks it. i mean physical and let's do business and where starting with some breaking news siemens chief executive joe kayser has just announced that he will not attend the future investment initiative conference in saudi arabia following the killing of journalist john mica shockey the german engineering giant is one of the last companies to decide against sending its top executives to the davos in the days it many companies including j.p. morgan and ford had previously pulled out of the event as has u.s. treasury secretary statement. italy is here to stay prime minister because he says his country won't leave the european union but that it will stick to its deficit hike that's despite e.u. criticism he argues the economy needs a lift biggest member state germany has warne

term as chancellor we take a look at her potential successors also coming up a deadly storm striking italy fierce wind and rain lashed the country killing at least nine people and venice get swamped reporting record high water levels. and a david and goliath matchup in the german colony powerhouse barn a car on the prototype tiny birding hausen tonight and the fourth division club is hoping for a massive i'm sure that. i'm seeing you so much going to thank you for joining us a day after chancellor angela merkel announces her plan to exit germany and the world look ahead to who might replace her merkel has said she will resign as leader of her party in december and step down as chancellor at the next election the move follows heavy losses for her conservatives and recent state elections one thing is clear the person who succeeds merkel will have big shoes to fill. an earthquake a bombshell a day of destiny there has been no shortage of dramatic descriptions for because announcement. essence. firstly at the coming c.d.u. pasi conference in december i have decided not to run again for c.d.u.